With the support of its recently elected justices, the Pennsylvania Supreme Court, in an opinion issued on September 28, 2016, held four provisions of Pennsylvania’s Oil and Gas Act (also known as Act 13) to be unconstitutional. In addressing the severability of various provisions of Act 13, and emboldened by its 2014 plurality decision (which the Court noted as being “scholarly and comprehensive”), the Court held that: (1) private water supplies require the same protection under Act 13 as afforded to public water supplies; (2) the PUC is no longer authorized to review local ordinances to ensure compliance with Act 13; (3) restrictions and obligations placed upon physicians related to the confidentiality of fracturing fluid trade secrets is improper; and, (4) eminent domain powers related to natural gas storage cannot ecumenically be afforded to all gas companies. A copy of the 88 page majority decision is available here: Robinson Twp. v. Commonwealth.
The four invalidated provisions were rarely, if at all, enforced following the enactment of Act 13 in 2012. Nevertheless, the Court articulated a concern that the legislature provided special treatment to the natural gas industry when creating and enacting Act 13. As such, the Court found certain provisions of the Act to be unconstitutional pursuant to a prohibition on special laws.
Of additional importance to natural gas operators, the Court, in dicta, repeatedly emphasized a municipality’s right to enact a zoning ordinance that precludes oil and gas development in various zoning districts, to establish setbacks in excess of those required by Act 13 and, possibly, to limit noise and hours of operation. This dicta is important because the Court recently granted an allowance of appeal in the Gorsline case, which will determine whether unconventional natural gas development is an industrial activity and, as such, should be restricted to industrial zoning districts. Further, the joinder of the three newly elected justices to the Sept. 28th majority opinion may also indicate an openness to permit municipalities to further limit natural gas development via local ordinance restrictions.